Federal Bank Shares Zoom Over 6% After Release of Q2 FY25 Results

On October 28, 2024, Federal Bank announced its results for the quarter ended September 30, 2024, showcasing robust performance across multiple metrics. As of 30th September 2024, Federal Bank operates 1,533 banking outlets and 2,052 ATMs and cash recyclers, reinforcing its extensive reach and accessibility.

Resilient Balance Sheet Performance

The total business of the bank reached ₹4,99,418.83 crore, reflecting a growth of 17.32%. Total deposits increased from ₹2,32,868.43 crore on 30th September 2023 to ₹2,69,106.59 crore a year later. On the asset side, net advances rose from ₹1,92,816.69 crore to ₹2,30,312.24 crore during the same period. 

Retail advances grew by 17.24%, reaching ₹72,701.75 crore, while business banking advances saw a 19.26% increase to ₹19,121.18 crore. Commercial banking advances surged by 24.34% to ₹24,493.35 crore, and corporate advances registered a growth of 10.48%, totalling ₹77,953.84 crore. Additionally, CV/CE advances grew significantly by 43.83%, reaching ₹3,932.30 crore.

Highest Ever Operating Profit and Net Profit

The bank reported an operating profit of ₹1,565.36 crore and a net profit of ₹1,056.69 crore for the quarter ended 30th September 2024. This marks an 18.19% year-on-year growth in operating profit. Notably, the bank has surpassed the ₹1,000 crore net profit mark for the second consecutive quarter, following a net profit of ₹1,010 crore in the previous quarter.

Remarkable Income Parameters

Net interest income increased by 15.11%, rising from ₹2,056.42 crore to ₹2,367.23 crore as of 30th September 2024. The bank’s total income grew by 21.91%, reaching ₹7,541.23 crore. Earnings per share (EPS) for the quarter, when annualized, stands at ₹17.11. The return on assets (ROA) and return on equity (ROE) for the bank were recorded at 1.28% and 13.65%, respectively, for the quarter.

Robust Asset Quality

As of the end of Q2 FY25, the gross non-performing assets (NPA) stood at ₹4,884.49 crore, accounting for 2.09% of gross advances. The net NPA amounted to ₹1,322.29 crore, representing 0.57% of net advances. The provision coverage ratio, excluding technical write-offs, was reported at 71.82%.

Net Worth & Capital Adequacy

The bank’s net worth increased from ₹26,032.07 crore to ₹31,108.20 crore as of 30th September 2024. The capital adequacy ratio (CRAR), calculated in accordance with Basel III guidelines, was 15.20% at the end of the quarter.

KVS Manian, MD & CEO of Federal Bank, stated, “Q2 has been robust for the Bank, driven by strong momentum across diverse operational verticals. This is clearly reflected in our consecutive surpassing of the 1000 Crore net profit milestone for two quarters in a row. Our deposits, now upgraded to AAA by CRISIL, signify a sturdy core of the franchise. Business momentum across verticals has been strong and inclusive, and asset quality improvements have been notable. We are committed to sustaining and building on this strong momentum to achieve continued success for the Bank.”

On October 29, 2024, Federal Bank shares opened at ₹193.70 and touched the day high of ₹197.40, reflecting a gain of 6.77% at 09:35 AM. 

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